The chief executive of Guardian Media Group has defended its decision to sell its regional arm describing it as a “very small scale business.”

In a podcast interview, Carolyn McCall said the purpose of the group’s regional titles had been to act as a “safety net” for the loss-making Guardian – but claimed they had stopped fulfilling that role.

The group sold its regional subsidiary GMG Regional Media, which includes the Manchester Evening News, to Trinity Mirror for £7.4m cash and release from a £37.4m printing contract ewarlier this week.

In the podcast, Ms McCall admitted that severing the 142-year-old link with Manchester had been a difficult decision, but said the regional newspaper business now represented too much of a risk.

“You can look at the cash value and say it wasn’t very much but the £70m revenue in that business was in decline. Regional newspapers have been at the very sharp end of disruption from digital and for us it was a very small scale business,” she said.

“It had just four per cent of the regional news market and despite really historic connections what it was set up to do for the Guardian was to be a safety net and it stopped being a safety net some years ago.”

Questioned about Trinity Mirror’s reputation as heavy-cost cutters, she said it would have been no different had GMG remained in charge of the regional titles.

“Everyone at regionals knew that cost reduction programmes were not over so we would have had to have made more redundancies going forward because the business has fundamentally changed,” she said.

Last year, GMG’s regional division made a profit of £500,000, down from £14.3m in 2007-2008.

The national division, Guardian News and Media, had been losing around £30m a year until a programme of cost-cutting was introduced late last year which has since resulted in more than 100 redundancies.

Comments

All Subbed Out (12/02/2010 11:27:41)
If GMG Regional Media is a small-scale business now, it’ll be a lot smaller yet after Trinity Mirror gets to work on it….

Subbed off (12/02/2010 16:02:02)
It might be small scale, but at least it makes money, which is more than can be said for GMG which, er, is large scale but never makes any money. This podcast smacks of sour grapes by someone who realises they’ve been stung

Dan Depan (15/02/2010 10:09:18)
It was certainly small scale by the time that McCall et al had finished with it.
Probably too far gone to resurrect – another triumph for liberal journalism

Alan Salter (15/02/2010 10:21:17)
…and there was me thinking I spent more than 30 years helping keeping the Guardian afloat.

Ivor Biggun (15/02/2010 18:53:47)
Never let a Female Liberal run a business.

Jimmy Ross (17/02/2010 11:22:26)
The comment from Carolyn McCall that the Manchester Evening News is “a very small scale business” is an insult to the hundreds of journalist who provided for many, many years the profits which kept the Guardian going. But for the existence of the MEN the Guardian would have disappeared long ago if it had had to rely on its own on its own merits as a newspaper. Her comment is particularly galling coming from the chief executive of a “very large scale business” which she has managed to lead to a loss of around £30 million a year. God help the newspaper industry in Britain if it cannot do better than Ms McCall.